According to the Associated Press, Socrates said the computer would be distributed to students under the government's existing subsidized "e-School" program. The cost to students will be determined by the family's income, with a maximum price of about €50 ($78).

Intel's pact also fans the flames of a market rivalry between itself and the non-profit One Laptop Per Child (OLPC) foundation. Both companies compete to sell small, cheap notebooks geared towards the education of youngsters in developing countries.

Early this year, Intel walked out of the OLPC project after receiving a frosty reception due to its continued sales of the Classmate PC design.

OLPC's visionary Nicholas Negroponte slammed Intel before it joined, telling the company it should be "ashamed of itself" for undercutting his own scheme to get affordable laptop computers to children in developing countries.

After Intel joined the organization, Negroponte continued to press for ending sales of the Classmate laptop. After only about six months, Intel was fed up. OLPC denied Intel's departure was about rival machines, but claims relations broke down because of "a complete lack of cooperation by Intel on software, learning etc." ®